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Afghan companies with insurgent ties get U.S. contracts despite safeguards


WASHINGTON » Facing a well-financed insurgency in Afghanistan, the United States has struggled for years to cut off the main contribution American taxpayers make to Taliban coffers: the hiring of Afghan contractors with ties to the insurgents.

But despite the development of contractor blacklists and other requirements earlier in the war, U.S. investigators have uncovered a new case that casts doubt on the military’s ability to weed out suspicious contractors from the thousands who work with the United States to build bases, ship supplies and carry out myriad other tasks.

The case centers on the Zurmat Material Testing Laboratory, part of the Zurmat Group, an Afghan company that the investigators say was paid to do work at an American-controlled facility in November 2012, despite having been blacklisted two months before by one part of the military for providing bomb-making materials to insurgents.

The Zurmat case was outlined in a letter sent last week to Defense Secretary Chuck Hagel by the Special Inspector General for Afghanistan Reconstruction, an internal government watchdog. A copy of the letter was provided to The .

According to other documents and a review of internal Pentagon communications obtained by The Times, the United States Central Command, which oversees the war in Afghanistan, requested in 2012 that Zurmat and its subsidiaries, along with more than 40 other companies and individuals believed to have ties to insurgents, be "debarred" by the Army. This would formally ban them from doing work for any part of the U.S. government.

At the time, officials estimated that those contractors had collectively been awarded more than $150 million in work for the U.S.-led coalition over a 10-year period.

But the Pentagon officials who rule on suspension and debarment cases have so far refused to issue the bans. In the documents, the officials argue that because the evidence against Zurmat and the other companies and individuals consists largely of classified intelligence, which cannot be shown to the accused contractors, debarment would violate their right to due process.

The Pentagon did not immediately respond to a request for comment about the Zurmat case or the broader dispute over using classified intelligence to ban contractors suspected of supporting insurgents.

Coming after years of mounting concerns about waste and possible misdirection of the billions of dollars in aid and military contracts given throughout the war, the Zurmat case, which has been festering for nearly a year, adds insult to injury in the eyes of some members of Congress. Lawmakers have expressed anger at the Pentagon’s refusal to ban contractors suspected of having ties to militants, and they are pressing again to force it to cut off the money.

"It’s like we’re subsidizing the people who are shooting at our soldiers," said Sen. Jeanne Shaheen, D-N.H.

Zurmat was first blacklisted in April 2012 by the Commerce Department because of accusations that it had helped the feared Haqqani insurgent faction in Afghanistan obtain bomb-making materials. Then, in September of that year, the military’s Central Command banned Zurmat from working on contracts within its area of operations, which stretches from the Middle East to Pakistan.

But that order did not automatically result in warnings to other companies that might have been subcontracting work to Zurmat or one of its subsidiaries. Such warnings would only be issued if the company were formally debarred by the Defense Department, according to the special inspector general’s letter to Hagel.

As a result, employees at the Zurmat testing laboratory gained access in November 2012 to what was at the time the main U.S.-run prison in Afghanistan, the letter said. Zurmat had been hired to perform safety tests on the construction work done by another contractor, CLC Construction, which was building a courthouse at the prison and had not been informed of the Central Command decision to bar the Afghan firm.

The inspector general said it had uncovered the work done by Zurmat as part of a separate investigation into shoddy construction work at the detention facility, which is adjacent to Bagram Air Base, one of the largest coalition bases in Afghanistan.

"This lapse in security highlights the immediate need for a simple process to ensure that individuals and companies identified as supporters of the insurgency are prevented from accessing U.S.- and coalition-controlled facilities," the inspector general wrote to Hagel.

It is unclear how much Zurmat was paid for its work at the prison, or whether its employees had access to particularly sensitive areas.

It is also unclear whether Zurmat or any of the other companies proposed for debarment are still doing work for the coalition. It is nearly impossible to track subcontracts, officials say, and that has made it very difficult to enforce bans, especially those issued only by one command.

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